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I'd suggest allowing file:// by default, but not allowing recursion to fetch a file:// URI, whether the source page comes from http:// or file:// or something else. wget could then have a --force-file-recursion or similar, if anyone cared. Bonus if wget can allow file links but only to files under the same prefix as the original file.

But even the basic support for file:// with no recursion allowed would still prove useful, albeit not for the use case described in the linked mail.

For instance, file:// should never be respected when it comes from the web. Even on local machine, it could be problematic to use it on files writable by other users (as they can then craft links to download privileged files with upgraded permissions). Perhaps files that are only readable for root should always be skipped, or wget should require a "--force" sort of option if the current mode can result in more permissive settings on the downloaded file.

For such reasons, perhaps it would be wise to make this a configurable option. It might also be prudent to enable an option for file:// to be disallowed for root.